Food Inflation/Deflation

[chssooner]

Well no crap the prices of food are increasing. If labor shortages (and costs) increase, and transportation costs increase, then the price is obviously going to increase.

[PoliSciGuy]

I *strongly* recommend you get your Christmas shopping done ASAP. The supply chains are gonna get worse before they get better.

[oklip955]

The price of beef has really gone up. Go price a nice steak. Ugh

[BoulderSooner]

Well no crap the prices of food are increasing. If labor shortages (and costs) increase, and transportation costs increase, then the price is obviously going to increase.

the white house thinks raising prices is unfair ..

[Cocaine]

I *strongly* recommend you get your Christmas shopping done ASAP. The supply chains are gonna get worse before they get better.

The supply chain issues will not improve this year. I know a lot of factories in Vietnam that pretty much lost a lot of workers due to covid and they are just now starting to reopen due to covid restrictions. Those workers aren't coming back this year and they will not be open to get up and running in time for Christmas. It's literally a nightmare of supply chain issues, factory shutdowns in vietnam, a bunch of issues in china. This is bad and even if the issues at ports are fixed in the US it won't fix the problems in East South Asia.

[Canoe]

The supply chain issues will not improve this year. I know a lot of factories in Vietnam that pretty much lost a lot of workers due to covid and they are just now starting to reopen due to covid restrictions. Those workers aren't coming back this year and they will not be open to get up and running in time for Christmas. It's literally a nightmare of supply chain issues, factory shutdowns in vietnam, a bunch of issues in china. This is bad and even if the issues at ports are fixed in the US it won't fix the problems in East South Asia.

https://www.foxbusiness.com/markets/...nary-pressures

Our businesses are still struggling with increased input costs.

[Canoe]

The UN's Food and Agriculture Organization's food price index, which tracks a basket of food commodities, averaged 133.2 in October, up 3.9 points (3%) from September and 31.8 points (31.3%) from October 2020. The index has risen three consecutive months and is now at a new decade high

[soonergolfer]

Keeps on rolling.

https://www.cnbc.com/2021/11/10/cons...x-october.html

[Canoe]

https://www.bloomberg.com/news/artic...&sref=6uww027M

Cargill CEO says prices will continue to rise.

[April in the Plaza]

i keep hearing that the supply chains will be messed up, pretty badly, until the very back half of 2022

[ChrisHayes]

This inflation was totally predictable when the gov't shut down the economy last year, and the Fed had to come to the rescue with massive money production. Especially with hundreds of billions to trillions hitting the streets in the name of stimulus. It may only get worse with the infrastructure bill and any other spending bills that are coming down the pike.

[TheTravellers]

What’s Really Driving Inflation? Corporate Power

Lots more at the link, but here's a sample:

"The biggest culprit for rising prices that’s not being talked about is the increasing economic concentration of the American economy in the hands of a relative few giant big corporations with the power to raise prices.

If markets were competitive, companies would seek to keep their prices down in order to maintain customer loyalty and demand. When the prices of their supplies rose, they’d cut their profits before they raised prices to their customers, for fear that otherwise a competitor would grab those customers away.

But strange enough, this isn’t happening. In fact, even in the face of supply constraints, corporations are raking in record profits. More than 80 percent of big (S&P 500) companies that have reported results this season have topped analysts’ earnings forecasts, according to Refinitiv.

Obviously, supply constraints have not eroded these profits. Corporations are simply passing the added costs on to their customers. Many are raising their prices even further, and pocketing even more.

How can this be? For a simple and obvious reason: Most don’t have to worry about competitors grabbing their customers away. They have so much market power they can relax and continue to rake in big money.

The underlying structural problem isn’t that government is over-stimulating the economy. It’s that big corporations are under competitive.

Corporations are using the excuse of inflation to raise prices and make fatter profits. The result is a transfer of wealth from consumers to corporate executives and major investors.

This has nothing to do with inflation, folks. It has everything to do with the concentration of market power in a relatively few hands.

It’s called “oligopoly,” where two or three companies roughly coordinate their prices and output.

Judd Legum provides some good examples in his newsletter. He points to two firms that are giants in household staples: Procter & Gamble and Kimberly Clark. In April, Procter & Gamble announced it would start charging more for everything from diapers to toilet paper, citing “rising costs for raw materials, such as resin and pulp, and higher expenses to transport goods.”

Baloney. P&G is raking in huge profits. In the quarter ending September 30, after some of its price increases went into effect, it reported a whopping 24.7% profit margin. Oh, and it spent $3 billion in the quarter buying its own stock.

How can this be? Because P&G faces very little competition. According to a report released this month from the Roosevelt Institute, “The lion’s share of the market for diapers,” for example, “is controlled by just two companies (P&G and Kimberly-Clark), limiting competition for cheaper options.”

So it wasn’t exactly a coincidence that Kimberly-Clark announced similar price increases at the same time as P&G. Both corporations are doing wonderfully well. But American consumers are paying more. "

[BoulderSooner]

. Corporations are simply passing the added costs on to their customers. "

yes because this is how the real world works ... . even if the white house thinks that is "unfair"

[chssooner]

Robert Reich is an embarrassment to true liberal thought. Whether it be Germany or Italy or the UK, companies in social countries all over the world pass increases in costs on to customers. This is economics and accounting 101. And it won't change. No matter who is in the White House. Hell, France could take us over, and it would still be the same way.

[TheTravellers]

Robert Reich is an embarrassment to true liberal thought. ...

Why?

[chssooner]

Why?

Because he is too extreme. Like, blaming companies for passing their increased costs onto customers. That happens in every country in the world, yet apparently it is only bad when American companies do it. Not saying it isn't a bad thing for consumers, but blaming companies for sound accounting and economic practices isn't fair.

[TheTravellers]

Because he is too extreme. Like, blaming companies for passing their increased costs onto customers. That happens in every country in the world, yet apparently it is only bad when American companies do it. Not saying it isn't a bad thing for consumers, but blaming companies for sound accounting and economic practices isn't fair.

That was one small part of his article, and it related to the massive profits that the companies are having. And then there's this:

https://www.reuters.com/world/us/fed...es-2021-10-04/

""I am concerned about the changing mentality, I would say, around prices in the economy and the relative freedom that businesses feel that they can just pass on increased costs easily to their customers. For years, that's not been the case," Bullard added."

https://www.detroitnews.com/story/bu...rs/8112402002/

"Across the S&P 500, such moves mean companies appear to have held onto $13 of profit for every $100 they made in sales during the spring. That would be the highest profit margin for a quarter since FactSet began tracking the measure in in 2008, and it’s well above the average of $10.60 for the past five years."

Basically, businesses are raising prices higher than their increased costs and still making insane profits, which is not normal. It's not like they're raising prices to keep themselves afloat, they're doing it to make ridiculously more profit than they already are. If a company can afford to buy back $3 billion worth of stock, they can handle an increase in some of their costs and not pass them on to the consumer.

Anything else that makes him an embarrassment?

[chssooner]

That was one small part of his article, and it related to the massive profits that the companies are having. And then there's this:

https://www.reuters.com/world/us/fed...es-2021-10-04/

""I am concerned about the changing mentality, I would say, around prices in the economy and the relative freedom that businesses feel that they can just pass on increased costs easily to their customers. For years, that's not been the case," Bullard added."

https://www.detroitnews.com/story/bu...rs/8112402002/

"Across the S&P 500, such moves mean companies appear to have held onto $13 of profit for every $100 they made in sales during the spring. That would be the highest profit margin for a quarter since FactSet began tracking the measure in in 2008, and it’s well above the average of $10.60 for the past five years."

Basically, businesses are raising prices higher than their increased costs and still making insane profits, which is not normal. It's not like they're raising prices to keep themselves afloat, they're doing it to make ridiculously more profit than they already are. If a company can afford to buy back $3 billion worth of stock, they can handle an increase in some of their costs and not pass them on to the consumer.

Anything else that makes him an embarrassment?

He isn't accounting for the fact that people keep getting paid more, despite what the minimum wage is. Companies are having to pay more to get and keep employees, or offer better benefits. Those are overhead costs included in pricing items. As things around supply chain issues also increase in price, those impact the price of goods. I'm not saying companies are free from some guilt and greed. Not by any means. But there are other factors than just the cost of a good to a retailer that affect the cost of an item on the consumer. Some quantitative, some not.

[mugofbeer]

There are also other factors at play not discussed such as a continuation of a dramatic demographic change in shopping habits away from bricks and morter into online shopping and curbside pickup - much of which not only costs the consumer less, but is more profitable to the company (see today's announcement that CVS is closing 10% of it's brick and morter).

Prof. Reisch doesn't seem to understand the market takes care of itself. If a company makes too much profit, others will always come in to compete. His kneejerk reaction is always government intervention and taxation before the natural progression of supply and demand.

[April in the Plaza]

i'm more than fine with paying 10-20% more if it means the cashiers can make a healthier wage

[mugofbeer]

That's why we have choices but not everyone is able to do that.

[oklip955]

i'm more than fine with paying 10-20% more if it means the cashiers can make a healthier wage

You maybe fine but what about alot of older people on fixed incomes? What those who dont get automatic colas to their pensions? My pension in 12 yrs only increased 4% in that time. How much did stuff go up in that time and this was before this current round of inflation. Not all of my fellow retirees have SS or other pension investments or can just go back to work. Those who do have SS because its a pension in lo of ss then the ss is hit with a large penalty. I am one of the luckier ones with mine but lots of older folks or ones that are now disabled are stuck in a squeeze. I'll bet there are a lot of others who were just getting by before this round of inflation and like you say now paying that 10 to 20% more. Wonder if more seniors will have to turn to food banks. I have a friend in another state that is disabled and their pension is no longer covering basic living expenses. Folks can only cut back so much on basics.

[Jersey Boss]

You maybe fine but what about alot of older people on fixed incomes? What those who dont get automatic colas to their pensions? My pension in 12 yrs only increased 4% in that time. How much did stuff go up in that time and this was before this current round of inflation. Not all of my fellow retirees have SS or other pension investments or can just go back to work. Those who do have SS because its a pension in lo of ss then the ss is hit with a large penalty. I am one of the luckier ones with mine but lots of older folks or ones that are now disabled are stuck in a squeeze. I'll bet there are a lot of others who were just getting by before this round of inflation and like you say now paying that 10 to 20% more. Wonder if more seniors will have to turn to food banks. I have a friend in another state that is disabled and their pension is no longer covering basic living expenses. Folks can only cut back so much on basics.

It seems that your concerns have more to do with how pension systems and Social Security administer benefits and how much they pay out.
Paying a living wage to current workers and how that affects retirees should have no bearing on each other.

[Canoe]

It seems that your concerns have more to do with how pension systems and Social Security administer benefits and how much they pay out.
Paying a living wage to current workers and how that affects retirees should have no bearing on each other.

I agree we shouldnt have to balance two vurenable groups, but that is not the world we live in. Besides shopping at places that pay thier employees more like whole foods, what else can be done right now? I giess you could have a state run grocery store that offered basics at a subisized rate. Hmmm, I am not sufe how that would turn out though....

[Jersey Boss]

Have you seen any proposals from the leadership in either party addressing inflation?
I've heard complaining and have seen finger pointing but no solutions proposed.